Key Takeaways:
- The average net worth of Americans increases with age, with 50-somethings having an average net worth of $1.4 million and 60-somethings having an average net worth of $1.6 million.
- The main factors contributing to wealth accumulation are stocks, homes, and time.
- Homeownership and investing in the stock market can significantly increase net worth over time.
- The median net worth is significantly lower than the average net worth, indicating that a small number of wealthy individuals drive up the average.
- Net worth typically peaks in the 60s and begins to decline in the 70s.
Introduction to Net Worth by Age
The data on net worth in America tells a clear story: the older you get, the wealthier you are likely to be. According to a report from Empower, the average 50-something American has a net worth of $1.4 million, while the average 60-something has a net worth of $1.6 million. In contrast, the average 20-something has a net worth of just $127,730. These numbers are estimates based on anonymized data from Empower users in October 2025 and are consistent with the findings of the federal Survey of Consumer Finances.
The Secret to Building Wealth
So, how do older Americans accumulate such wealth? Financial experts cite three main factors: stocks, homes, and time. The S&P 500 has risen by 256% over the past decade, or about 13.5% a year, according to an analysis by The Motley Fool. This means that if a sum of money is invested in stocks, it can multiply in value over time. For example, if a portfolio doubles every 7 to 10 years, it can grow significantly over a 40-year period. Home values have also risen substantially over the past decade, and homeownership can function as a piggy bank, building equity over time.
The Impact of Homeownership
Homeownership rates rise with age, and older Americans are more likely to have significant equity in their properties. In addition to building wealth through stocks and homes, older Americans may also inherit money, which can further increase their net worth. As people age, their cumulative chance of inheriting money rises, and this can be a significant factor in wealth accumulation. For example, someone in their 50s may inherit a home from a parent, which can be a significant addition to their net worth.
Understanding the Numbers
It’s worth noting that there is a significant discrepancy between the mean and median net worth. The average 50-something is worth $1.4 million, but the median net worth is just $192,964. This means that a small number of wealthy individuals drive up the average, while the majority of people have significantly lower net worth. This is an important distinction to make when interpreting the data, as it highlights the significant wealth inequality in America.
Net Worth by Decade
So, what does net worth look like by decade? The data shows that net worth increases significantly with age. 20-somethings have an average net worth of $127,730, while 30-somethings have an average net worth of $321,549. 40-somethings have an average net worth of $770,892, and 50-somethings have an average net worth of $1.4 million. 60-somethings have the highest average net worth, at $1.6 million, while 70-somethings have an average net worth of $1.5 million.
The 20s: Getting Started
For 20-somethings, the focus is on getting started financially. Many people in this age group are finishing college and starting their careers, and they may be dealing with debt, including student loans and credit card debt. The goal for this age group is to get back to zero, or to pay off debt and start building savings. As Jonathan Swanburg, a certified financial planner, notes, "Ultimately, in your 20s, it’s just about getting back to zero."
The 30s: Establishing a Career
In their 30s, people are starting to establish their careers and build their finances. They may be getting married, having children, and buying homes, which can be significant expenses. However, they are also starting to build retirement savings and may be getting promotions and raises at work. As Ryan Viktorin, a vice president and financial consultant at Fidelity Investments, notes, "You’re starting to get established in your career, and maybe you’ve gotten a promotion or two."
The 40s: Peak Earning Years
The 40s are often peak earning years, and people in this age group may be able to save more and invest more in their retirement accounts. They may also be paying off their mortgages and building significant equity in their homes. As Liz Gillette, a certified financial planner, notes, "This is where the impact of compounding starts to show." However, people in this age group may still be dealing with significant expenses, including childcare and education costs.
The 50s: Peak Net Worth
The 50s are often the decade when people reach peak net worth. They may be at the height of their careers, and they may have significant equity in their homes. They may also be building significant retirement savings and may be inheriting money from their parents. As Colin Day, a certified financial planner, notes, "You think about people in their 50s inheriting homes, and they already have a home."
The 60s: Retirement
The 60s are often the decade of retirement, and people in this age group may be collecting Social Security and drawing down their savings. They may also be paying off their mortgages and enjoying the fruits of their labor. As Viktorin notes, "This is your peak, and you’ve probably stopped working." However, people in this age group may also be dealing with significant expenses, including healthcare costs and long-term care costs.
The 70s: Spending Down Savings
Finally, the 70s are often the decade when people start spending down their savings. They may be living off the returns on their investments and may be drawing down their retirement accounts. As Viktorin notes, "Anybody that has retired over the past 10 or 15 years has retired into an up market." However, people in this age group may also be dealing with significant expenses, including healthcare costs and long-term care costs, and may need to be careful with their finances to ensure that they have enough money to last throughout their retirement.